Watercraft
The term watercraft covers a range of different water-borne vehicles including ships, boats, hovercraft and submarines. The term would normally imply some propulsive capability (whether by sail, oar or engine) and hence is distinct from a simple device that merely floats, such as a log raft.
Terminology
Most watercraft would be described as either a ship or a boat. However, there are numerous craft which many people would consider neither a ship nor a boat, such as: surfboards (when used as a paddle board), underwater robots, seaplanes, jetskis and torpedoes.
Although ships are typically larger than boats, the distinction between those two categories is not one of size per se.
Ships typically are large ocean-going vessels. Boats are smaller and travel most often on inland or coastal waters.
A rule of thumb says "a boat can fit on a ship, but a ship can't fit on a boat", and a ship usually has sufficient size to carry its own boats, such as lifeboats, dinghies, or runabouts.
Local law and regulation may define the exact size (or the number of masts) that distinguishes a ship from a boat.